The limits of conservatism

William Schneider

November 30, 1990|By William Schneider

THE 1980s were the decade of conservatism triumphant. It all began with Margaret Thatcher, who became British prime minister in May 1979, more than a year before Ronald Reagan was elected president. Now Thatcher has fallen, betrayed by her own party, after a record 11 1/2 years in office.

There is a message here for Republicans in the United States, who are completing their 10th continuous year in office. It has to do with the limits of conservatism. Both the British Conservatives and the American Republicans came to power under the same circumstances -- a popular revolt against inflation, high taxes, big government and national decline. Like Reagan, Thatcher changed the direction of government in her country. Thatcherism, like Reaganism, became a recognized political creed.

Both Reagan and Thatcher were conviction politicians. Neither flinched from conflict, whether it was with the "Evil Empire," Third World dictators or entrenched trade unions. In the end, both leaders were credited with reversing their countries' economic and military decline. And their parties won three national elections in a row.

In the early 1980s, Thatcher, like Reagan, took her country through one of the worst recessions in its history. The British people, like the American people, stayed the course. But they are not staying the course now that bad economic conditions have returned (6 percent unemployment and 11 percent inflation, both rising). "What a record!" opposition leader Neil Kinnock said in the House of Commons in late November. "Eleven oil-rich years, with a recession at each end and a miracle in between!"

If the British people are no longer staying the course, it is not because the economy is bad. It is because they don't like the course. Thatcher took national self-assertion, one of the hallmarks of her conservative philosophy, too far. She took the restructuring of the tax system, another conservative cause, too far. And she refused to acknowledge what is heresy to conservatives but simple common sense to most voters -- that government has a legitimate role in solving social problems.

The immediate cause of Thatcher's demise was Europe. She was not going to cede policy-making authority to a bunch of socialist bureaucrats. But neither her party colleagues nor the voters saw any possible economic future for Britain outside of Europe. Nor did the United States offer her any encouragement. The Bush administration was critical of Thatcher for her resistance to European economic integration and for her efforts to slow down German unification.

To British voters, the biggest complaint about Thatcher was the so-called poll tax. This is a new and highly unpopular local tax imposed by the Thatcher government. Instead of taxing property, local governments must now assess a tax on individuals. Every person is taxed at the same rate, regardless of ability to pay. The idea was to deprive the Labor Party-dominated local councils of operating funds. The reality was that middle-income taxpayers -- the Conservative Party's core constituency -- rose up in revolt as they saw their tax bills soar.

Finally, Thatcher was unwilling to develop new programs to deal with serious national problems such as low industrial competitiveness, lagging education standards, poor productivity and deteriorating social welfare. "I came to office with one deliberate intent," Thatcher said, "to change Britain from a dependent to a self-reliant society, from a 'give it to me' to a 'do it yourself' nation."

In this country, President Bush has gotten into trouble over taxes. First he abandoned his no-new-taxes campaign pledge. Then he persisted in trying to hold down tax rates for the rich. The result was to endanger his support among middle-income taxpayers, the GOP's core constituency.

Bush is also finding it difficult to sustain support for his policies in the Persian Gulf. Americans are not interventionists. They appreciated the fact that Reagan restored the nation's military security, but they never went along with his interventionist policies in the Third World. When Bush shifted from a defensive posture to what appeared to be an interventionist policy in the gulf, his public support fell sharply.

Right now, there is a power struggle in the Bush administration over control of domestic policy. Conservatives, led by Housing and Urban Development Secretary Jack F. Kemp, argue that the administration ought to be more aggressive about solving social problems such as poverty, education and homelessness. But not through more government spending.

They talk about a "new paradigm" that uses tax incentives, decentralization, vouchers and public-private partnerships to "empower" the poor. The new paradigm has been publicly ridiculed by budget director Richard G. Darman, who labeled it "neo-neoism" and "sloganeering." To Darman, there is only one problem that needs solving, and that is the budget deficit.

Conservatism must adapt or die. That is the message of the Thatcher experience.

Bush runs the risk of taking Reagan's political philosophy -- interventionism, tax cuts and limited government -- and carrying it too far. With Thatcher's downfall, the Bush administration stands warned.